Jacob Stein specializes in structuring the ownership of your assets to make it difficult, or even impossible, for others to take them away. Creditors, plaintiffs, unhappy business partners, state and federal agencies - all can threaten those assets. Our asset protection planning can reduce, or even eliminate, those threats long before they appear. Our clients tell us that the peace of mind that asset protection brings is priceless.
The first thing you need to realize is that there is no structure that can protect your home 100%. It simply does not exist, because a local judge with jurisdiction over your real estate can always chose to ignore your asset protection structures and just sign a judicial deed, handing the real estate over to your creditors. With real estate the goal is to make it difficult and expensive to reach, changing the creditor's economic analysis of your case. This will cause plaintiffs and creditors to either walk away or to negotiate on better terms.
Protecting a personal residence is commonly accomplished by transferring title of the real estate out of your name (see Personal Residence Trusts and Limited Liability Companies on the right) or by eliminating the equity in the real estate (see Equity Strips on the right). We find these structures to be effective in 70-90% of cases, depending on your particular circumstances.
If you do want to shield the equity in your real estate 100%, you would need to sell it and focus on protecting the sale proceeds. Cash is possible to make unreachable (see Outright Sale on the right). You can also consider moving to a state that has an unlimited or a large homestead exemption (Florida, Texas, Kansas and Nevada).
We also have a few tricks up our sleeve that are not disclosed on this website.
Dolores was 84 and a widow. She had been living in the same house for 30 years, and it was fully paid off. She had virtually no savings, and lived off her Social Security benefits.
She was involved in an automobile accident and was sued. The plaintiff asked for $200,000 in excess of her insurance coverage. She was in danger of losing her home.
Representing the woman on a pro bono basis, we transferred the ownership of her house to a special residence trust. Seeing this, the plaintiff ceased its efforts to pursue our client in excess of her insurance limits.
While Dolores is not a typical asset protection client, her case is an excellent example of an important point- you do not need to be uber-rich, or rich at all, to engage in asset protection planning. We all have assets worth protecting. Whether your home equity is $200,000 or $2,000,000, the emotional attachment and the need to protect it is the same.